SIU preliminary investigates RAF over R340 million in duplicate payments to law firms

19 April 2023

The Special Investigating Unit (SIU) is investigating 102 Law firms- including the Sheriffs, which received duplicate payments from the Road Accident Fund (RAF) of approximately R340 million and has recovered approximately R18 million. The SIU was presenting its preliminary findings to Parliament’s Standing Committee on Public Accounts (SCOPA) on Wednesday, 19 April 2023.

The SIU has approached several legal practitioners with the evidence, and they have opted to cooperate with the SIU investigation in defrayal of their indebtedness by the signing of acknowledgments of debt (AoD). To date, the SIU has signed the AoDs to the value of R 68 000 000. The signing of AODs does not absolve the legal practitioners from any civil litigation that the SIU may institute or refer for criminal prosecution or being reported to a regulatory body, in this case, the Legal Practice Counsel.

So far, the SIU has made one referral to the National Prosecuting Authority (NPA) for evidence pointing to criminal conduct. There are 10 possible NPA referrals identified and five possible referrals to the Legal Practice Counsel.

Furthermore, the SIU is investigating 10 contracts for possible irregularities, fruitless and wasteful expenditure. Some of the contracts were flagged by the Auditor General. Four contracts to the value of approximately R837 million have been identified for review and possible cancellation.

The SIU is in terms of Proclamation R44 of 2021 authorised to investigate allegations of corruption and maladministration in the affairs of RAF, and to recover any financial losses suffered by the State.

The investigation has five focus areas:

Focus Area 1: The focus in this area looks at duplicate claim payments made to Attorneys, Claimants and Sheriffs and change of mandates.

Focus Area 2: This area focuses on procurement and tender irregularities, especially fruitless and wasteful expenditure.

Focus Area 3: The area zooms into RAF payment claims from service providers who have rendered services to the victims of the motor vehicle accident.

Focus Area 4: Focuses on possible inflated invoices submitted by the service providers, either by way of contract or the act. The investigation also focuses on possible collusion between the RAF employee and the services providers, and the bill of cost submitted by the attorneys.

Focus Area 5: This area focuses on fraudulent Claims- both foreign and national- and home modifications across the country as well as rejected claims.

The SIU is empowered to institute civil action in the High Court or a Special Tribunal in its name, to correct any wrongdoing uncovered during both investigations caused by acts of corruption, fraud, or maladministration. In line with the Special Investigating Units and Special Tribunals Act 74 of 1996, the SIU will refer any evidence pointing to criminal conduct it uncovers to the NPA for further action.

Issued by Kaizer Kganyago, Chief Stakeholder Relations and Communications (SIU), 20 April 2023